- Summary:
- With Liquidity Hub V2, Decentralized Exchanges (DEXs) will now have the autonomy to manage liquidity pipelines onchain.
Orbs, the leading L3 liquidity layer, has announced the launch of Liquidity Hub V2, the latest iteration of its omnichain protocol enabling liquidity management for decentralized exchanges (DEXes). Building on the success of V1, this upgrade addresses critical gaps in DeFi infrastructure, setting a new standard for onchain trading efficiency.
What’s Under the Hood in V2
Liquidity Hub V2 incorporates significant upgrades designed to empower DEXs with greater control over their liquidity management. Key improvements include dynamic fees, using a real-time fee structure based on the savings achieved for traders. This ensures cost optimization and efficient swaps, even under challenging market conditions.
An Enhanced AMM router for price simulation, meanwhile, provides continuous monitoring of automated market maker (AMM) prices throughout the Dutch auction process. This ensures Liquidity Hub consistently delivers superior pricing, particularly during periods of high volatility.
There’s also a LH Explorer tool that provides visibility into every transaction, detailing simulated AMM prices, Liquidity Hub prices, fees, gas costs, and savings. By integrating these features, Liquidity Hub V2 equips DEXs to operate with unparalleled efficiency, enabling them to attract more liquidity providers and offer traders a superior experience.
How It Started
When Liquidity Hub V1 launched over a year ago, it solved a key challenge for DEXes: overcoming fragmented liquidity which causes suboptimal pricing. Collaborating with QuickSwap, Orbs delivered a solution that unified liquidity across multiple chains and venues. The result was a seamless trading experience, enhanced by innovative features like multi-chain integration, MEV protection, and gasless transactions.
Over the past year, Liquidity Hub has integrated across nine chains and protocols, providing a superior trading experience for DeFi users. In the process, it’s delivered superior pricing and reduced slippage, challenging centralized exchanges (CEXs) in terms of execution quality. These achievements have laid the foundation for Liquidity Hub V2, which is optimized to meet the needs of the rapidly expanding multichain landscape.
Liquidity Hub is complemented by dLIMIT and dTWAP, two trading technologies that can be integrated into any DEX, allowing traders to enjoy CEX-style trading onchain. dLIMIT allows large orders to be broken down into smaller amounts, reducing slippage, while dLIMIT allows traders to average into positions through setting limit orders at desired price points.
How It’s Going
Liquidity Hub V2 grants DEXs the autonomy to manage liquidity pipelines onchain, reducing dependency on external aggregators and simplifying operations. This decentralized backend approach aligns seamlessly with Orbs’ vision of enhancing DeFi infrastructure without migrating liquidity. By enabling DEXs to focus on product innovation and market expansion, Liquidity Hub V2 should drive the next wave of DeFi growth.
The V2 protocol’s enhanced features – dynamic fees, superior AMM price monitoring, and greater granularity – free DEXes from the challenge of attracting sufficient liquidity under their own auspices. This saves them from needing to offer unsustainable token incentives to attract mercenary liquidity. With V2 now live, Orbs will be intent on securing further integrations of Liquidity Hub that will demonstrate its ability to enhance onchain trading.